Turkey’s multibillion-dollar submarine deal has received financial support worth €2.187bn in the form of a major loan agreement between German banks and the Turkish Treasury.
Turkey and the German shipyard, HDW, had been in negotiations over the terms of finance for the submarine deal, which was signed in July 2009.
An export credit agreement worth €1.878bn was signed between the Undersecretariat of the Treasury and a bank consortium, led by Bayerische Landesbank, for financing the production of six submarines in Turkey.
A further commercial loan agreement worth €309m was signed between the Undersecretariat of the Treasury and a bank consortium led by WestLB London Branch, according to Hurriyet Daily News.
A modernisation plan for Turkey’s older Ay Class submarines has been scrapped following the finalisation of the submarine contract.
Turkey is currently building its own corvette-type ships, patrol boats, coast guard boats and other amphibious platforms and plans to produce its own frigates by the end of this decade.